Creating a Great Template for Parking Lot Leases

All About Parking Lot Lease Agreements

A parking lot lease agreement is, as the name suggests, a type of legal document that is used to outline the terms under which a given parking lot will be leased to another party. These leases are generally used for commercial parking lots, although they are also sometimes used for independent parking lot owners who rent out their general spaces on an as needed or group basis to anyone who needs the room. Whether negotiating a long term or short term parking lease agreement, the general terms of how it operates will be very similar. They are important because without them it is impossible to know the details of exactly how a parking lot user is supposed to interact with the property and its owner. For example, some commercial parking lots actually have a lot of high value areas – such as luxury car parks – where a load of restrictions can come down. Many will even require expert haute couture in the art of parking in order to facilitate room for all of the expensive vehicles that may use it, while others simply want to make sure that every car gets the ample space it requires. It only takes a few overly aggressive parking habits to damage a neighboring vehicle worth hundreds of thousands of dollars. Because of this and many more reasons, a parking lot lease agreement is an important document. It outlines rules and regulations – such as the aforementioned ability to park in a certain manner. It will detail who is expected to perform maintenance on the lot (this will most commonly be the owner , but can be negotiated). It can even spell out other items further down the list such as security and insurance. These documents are also quite common in other situations. For example, a large apartment complex with services required to provide enough parking for all of its residents – and visitors – may need to approach a neighbor about leasing a portion of his or her parking lot in order to meet these needs. In these cases, the apartment complex owner will be the landlord and the property owner with the available spaces will be the tenant. Most of the time, however, parking lot leases will be between a single car owner renting out their spot to another party (who may or may not be known to them). All of these items may seem fairly simple, but they can come together to form a massive amount of money for a landlord that owns – when all of the agreements are signed up – a vast space he or she is not even using at the moment. A classic and common example of a successful deal along these lines comes from SCE Fitness in New York. The company was leasing out the spaces that were not being used by its employees to other companies at a time when parking was at a massive premium. It essentially charged a competitive and strong rate and quickly made a set of funds that ended up reaching over a million dollars. If creating an effective parking lot lease agreement template is important to you, you would do well to reference this and similar successful deals.

Essential Elements of a Template for Parking Lot Lease Agreements

When crafting an effective parking lot lease template, there are several essential elements that must be included to ensure clear expectations and legal compliance. These components typically address both the obligations and rights of the parties involved in the agreement. The terms and conditions of the agreement can vary based on the specific use of the parking space, as well as the parties involved. All terms, including the length of the lease, should be clearly outlined in the parking lot lease template. For instance, is the parking space to be used exclusively by a business, a community association, or as a general public parking lot? Additionally, the parking allotment for multiple tenants should be clearly understood to avoid overcrowding. Parking lot lease agreements may also stipulate that lessee agrees to assume responsibility for maintaining the space, such as, but not limited to sweeping, lighting, and snow removal. Leasing agreements may also be contingent on obtaining a city or state approved license to operate. It is important to include the operating hours within the template to determine whether access to the lot is available on a 24/7 basis or limited to certain hours of operation.
Typically, when leasing a parking lot, payment will be pro-rated, either on an hourly, monthly or annual basis. The terms of payment of the lease agreement should indicate whether the payment is due at the time the lease is signed or with recurring installments due throughout the term of the lease. A template lease agreement should also recite the method of payment, whether by check, wire transfer or some other form. The terms of termination must also be stated in the parking lot lease template, including the duration of notice to terminate the lease. This is especially important to state if a party is leasing on a short-term basis.
Violations of the terms of the parking lot lease agreement may include failure to make timely payments, improper use of the space, or interfering with others’ use of the space. In these instances, the lessor may be permitted to terminate the agreement on short notice or with cause. The parking lot lease template should also include the remedy available to the lessor in case of a violation, either through damages or withholding deposits for unpaid payment.

Legal Aspects of Parking Lot Leases

When drafting a parking lot lease agreement template, it is important to consider the legal aspects of the lease beyond those that apply to commercial or residential leases in general.
Zoning Laws
Zoning laws are local regulations that dictate the types of businesses and occupancies allowed at a location. Since property owners plan on leasing their parking areas to the highest bidder, a lease agreement should always include a provision that requires the prospective tenant to ensure that their operations or activities are not prohibited by the property’s zoning.
Liability Issues
Since a parking lot is a semi-public space, there is always potential for liability issues. However, when it comes to liability, there are two parties to consider: the landowner and the motorist. For instance, if there are dangerous conditions on the property that cause a motorist or guest to become injured, the motorist or guest can bring a lawsuit against the landowner. The question in this situation is whether the landowner was aware of the issue. If a pothole or other hazard exists that the landowner does not remedy in a timely manner, the landowner could be held liable, along with the driver for any injuries incurred.* Most parking lot lease templates I’ve seen have vague language regarding liability, putting almost all of the responsibility on the lessor. If your parking lot is located on a private property, you may want to limit your liability in these situations by requiring your guests and tenants to sign a liability waiver before entering the property. Also, make sure to include a language like the following in your lease template:
The parties understand that the Owner assumes no responsibility for the motorist’s vehicle while it is parked on the Property. If, however, the motorist’s vehicle sustains damage while parked, the Owner will make an effort to remedy this situation by allowing the vehicle owner to park a limited number of complimentary spaces to make up for the damage (Owner’s Liability). The Owner’s Liability shall never exceed the cost of one month’s parking fee. The Owner shall additionally never be responsible for any damage occurring as a result of the driver’s presence on the Owner’s lot to fix any damage as a result of this incident (Motorist’s Liability).
Insurance Requirements
Most business insurance policies do not cover liability caused by a third party and, since a parking lot lease exposes the landowner to liability from a third party, it is advised that owners require an additional indemnity agreement and insurance policy from their tenants. A couple examples of clauses you can add to your agreement are:
Consequences of Oversight
Failure to include the above clauses can open the landowner to liability in a greater degree than they already face when allowing others into their private lot. Moreover, an unenforceable and poorly written lease can open owner-tenant relationships to disputes, ending in costly litigation, both in terms of time and money. Therefore, it is important to always have qualified legal counsel review your template and any agreements that you enter into for the use of your parking lot to ensure that your interests are protected.

Tailoring Your Template for Parking Lot Lease Agreements

Assuming that you have found a free parking lot lease agreement template, you should adjust the content so that it clearly fits the business you are leasing to or leasing from. For example, if you are leasing your parking lot to a company with multiple deliveries, your lease should specify whether the rights of exclusive use are extended to just passenger vehicles or vehicles making deliveries too?
While it may seem simple, specifying what types of vehicles can park is hugely important in this case, because if your agreement is vague and someone parks a tractor-trailer in your parking lot, not only will that vehicle likely violate the code for your lot, but the other company may try to argue that their rights to park are violated if you ask them to move their truck!
Customizing your parking lot lease agreement can also mean using language specific to a certain jurisdiction. While some jurisdictions have clear laws and ordinances regarding the value of fees associated with parking or the amount of notice that has to be given before rescinding the rights granted, others are less clear.
It is always a good idea to check local ordinances before signing or issuing a parking lot lease agreement to make sure you are not violating any laws or ordinances with your proposed terms. Customizing your parking lot lease agreement when it comes to the laws of the local jurisdiction is important so that you can avoid any penalties or restrictions in the future, even if the other party is the one to blame.

Parking Lot Lease Agreement Templates: Mistakes to Avoid

One of the biggest mistakes made when writing an effective parking lot lease agreement template is vagueness in the terms and conditions of the lease. Leaving terms open to interpretation or without sufficient details leaves the document vulnerable to misinterpretation, which can lead to litigation and ultimately a more costly situation than if the issues were resolved ahead of time. In Section 1.0 of the above lease template, there are specific numbers of spaces that are outlined. Details such as this place an emphasis on what is being leased. This is the beginning to a well-detailed agreement.
One issue that can set a template agreement up for failure is the lack of a severability clause. This clause allows for certain sections of the lease to be stricken if it is deemed necessary by a judge for any reason. This may be needed if one part of the agreement restricts the owner from utilizing their space in a particular way . This clause would allow the owner to work out the restrictions with the tenant in a way that mitigates any damage that would have been caused if it was enforced. See Section 9.11 of the above template. Another common omission is the lack of a court of jurisdiction clause. Having jurisdiction over a dispute can be crucial depending on your geographical location. It can end up saving you both time and money, which can be critical to a small business.
Another common mistake is the failure to have the lease agreement template reviewed by an attorney. If you are renting out spaces on a residential or business level, there are safety codes and standards that must be followed. If you have not had an attorney review your lease, you could be incurring fines already for failing to include these standards. In addition to this, having the lease reviewed by an attorney can save you time and money as they are trained in language that mutual parties can agree on.

Leveraging Templates for Effective Parking Lot Lease Agreements

When it comes to real estate, vacancy is never a good thing. Your parking lot lease agreement template is what will prevent that vacant space from losing you money every month. If you know that you have a great lease template, then you are comfortable with the conditions it creates; you can advertise your lot for rent and rest easy knowing that no matter what business takes the space, it has just what it needs to succeed.
A parking lot lease agreement template is also something that will save your time and effort. Every time you make a new parking lot lease, it will be a little different. This is due to the unique nature of leases; every property is different and every tenant group needs will be different. As you make changes, you may find yourself wishing that you had written down a particular clause or phrase because now you will need to make that one-time change over and over again. If you write a good template, it will contain all of the common specifications for your leases and can save you time when creating new ones. This protects from both redundancy and the frustration of forgetting to include strong language in a contract.

Finding Templates for Parking Lot Leases

Several sources can be used to find reliable parking lot lease agreement templates that will serve as a great starting point for your agreement.
Legal Websites
Many legal websites, such as LexisNexis and FindLaw, offer parking lot lease agreement templates. Some of these documents are provided for free while others require subscriptions to access templates.
Real Estate Websites
Certain real estate websites offer real estate documents, including templates for parking lot lease agreements. For example, Zillow and Realtor.com offer such documents in addition to receiving rental payments online.
Professional Legal Advisories
Another option is to use resources from real estate associations and organizations, including the National Association of Realtors and the Real Estate Council of Canada . These resources, which are aimed at legal professionals, contain many highly detailed agreements, including real estate lease agreements.
Finding a template that will work for your situation is important, and this often takes a significant investment of time and effort. Be sure to compare several different parking lot lease agreement templates before settling on one to use for your own lease. As a rule of thumb, it is best to look for templates that have legally binding language and that cover all important provisions that are found in parking lot lease agreements. It is also a good idea to look for templates that have been updated in the past few years since newer versions will be more likely to include recent changes in real estate law.